Credit card debt can be brutal and punishing — as the total amount of credit card debt in the US jumped to nearly $4.1 trillion this year, there's no question that it's something you generally want to avoid, especially if you're younger and less financially stable.

This is a message that younger generations seem to have received loud and clear. Data suggests that millennials have been wary of cards, although a recent study shows that they may be starting to embrace them.

While that might seem like bad news, it's actually a positive for the millennial generation, and as Generation Z reaches adulthood, it's vital that they follow suit — responsibly, of course.

Why students should care about their credit profile

Virtually every American has a credit profile, which is a history of their use of credit, including accounts held, past borrowing, and payment history. Banks that issue loans and credit cards use the information in your credit profile to determine how trustworthy you are, and how likely it is that you'll pay back whatever you may owe in the future.

Your credit score, meanwhile, is a numerical representation of all of the raw information in your credit profile. It's made up of a few components, including your history of on-time payments, how much outstanding revolving debt you have proportionate to your total credit line, and the average length or age of your credit history.

Having a solid credit score isn't just important for mortgages and loans, though. Most landlords will run a credit check before approving your application to rent an apartment. Similarly, companies like utility providers and cell phone carriers check your credit score to make sure you've displayed responsible payment behavior in the past.

Once you have a credit card, the key is to simply use it exactly as if it were a debit card.

A lot of the fear of credit cards comes from a misunderstanding of how they work. Just because you use one doesn't mean you're taking on debt — you can (and should) pay more than the minimum required payment each month. If you pay the full statement amount — or the full balance — before the due date each time, you won't be charged any interest. Plus, you'll be able to earn rewards or take advantage of various protections and benefits.

How students can build credit with a card

For students, there are three good ways to start building credit.

1. Become an authorized user on a parent's account

When you're added as an authorized user on a parent or other loved one's account, you'll get a card with your name on it, but connected to their account. A lot of parents might want to do this so that you have a card to use in case of an emergency, but there's a second benefit.

Even if you never make a charge on the card, the entirety of that single account's history will be added to your credit profile. Of course, it's important that the account you're added to doesn't have any negative marks, so that you only have positive data points.

When I left for college, my mom added me to her oldest account, an Amex card. When I checked my credit report a few years later using Credit Sesame, I saw her entire account history on my profile as if it were mine — it showed "my" account as being older than I was!

2. Open a secured credit card

If you've never been added to a parent's account, or you aren't able to be added, you still have an option — get a secured credit card.

A secured credit card is one where you put down a deposit — for example, $200 — and then you get a card with a credit limit of the same amount. You can pay the card on time and prove that you're responsible, and eventually upgrade it to an unsecured credit card and get your deposit back.

You can usually get a secured card from the primary bank you use for your checking account. Alternatively, Discover offers a solid option that even earns cash back.

3. Open a "real" credit card

Although being an authorized user on an account or having a secured credit card can help build your early credit, you should still open a "real" credit card as soon as you have that early history established. You can open a student credit card through wherever you bank, but a better option is to open a solid cash-back or rewards card.

Why the Chase Freedom Unlimited is ideal for students

The Freedom Unlimited earns 3% back on all purchases in your first year up to $20,000 spent, then 1.5% back on all other purchases going forward. It has no annual fee, and it features an introductory 0% APR for the first 15 months, so if you want to break the rule and carry a balance for a few months (for instance, if you need to replace an aging laptop but it's a bit too pricey right now) without paying interest, this provides a great opportunity (after the introductory APR offer, a variable APR of 16.99% to 25.74% applies — so you should definitely pay off the balance by then).

While there are a few cards out there that offer 2% cash back, the real appeal of the Freedom Unlimited is that while the card is marketed as "cash back," it actually earns Chase's Ultimate Rewards (UR) points that you can redeem for cash (1 point = $0.01).

Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.

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Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

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